Iran-Pakistan relations
The Iran-Pakistan nexus
By Kaveh L Afrasiabi
News of the kidnapping of Iranian guards at the Iran-Pakistan border and Iran's accusation of US complicity with Sunni extremists operating from within Pakistan have ignited renewed interest in the ups and downs of relations between Iran and Pakistan.
Historically, different factors have affected Iranian-Pakistani political relations since the creation of Pakistan. As neighbors and Muslim countries, the two have always had close relations.
Iran was the first country to recognize Pakistan soon after its independence in August 1947.
During the first decade of independence, successive Pakistani governments attached high priority to establishing bilateral relations with Iran. In the early 1970s, Pakistan's success in ending a powerful separatist insurgency in the province of Balochistan, bordering Iran, would not have been possible without the support of the Iranian military. This, in fact, set the precedence for Pakistan's involvement in the anti-Soviet war in Afghanistan during the 1980s.
During the 1990s, relations between the two countries declined as a result of two concurrent developments: the rise of anti-Shi'ite terrorist activities in Pakistan and the assassination of Iran's counsel general, Sadeq Ganji, in Lahore in 1990, and subsequently the coming to power of the Taliban in Afghanistan.
When the Taliban captured the Afghan city of Maza-e-Sharif, they not only massacred thousand of Hazara Shi'ites, they also murdered scores of Iranian diplomats, straining Iran's bilateral ties with Pakistan, which at the time backed the Taliban.
When General Pervez Musharraf came to power in 1999, he visited Tehran and promised to address the terrorist activities in Pakistan; subsequently relations between the two countries improved. After the execution of Ganji's assassin by the Pakistani government in February 2001, Iran gained a new level of confidence in Pakistan's determination to curb anti-Shi'ite extremism in that country.
Still, as long as the Taliban remained in power in Kabul, supported by Pakistan, and Iran was committed to backing the anti-Taliban forces,
relations between Iran and Pakistan were held hostage to some extent by the developments inside Afghanistan. The September 11, 2001, terrorist attacks in the United States and the subsequent fall of the Taliban paved the way for the mending of bilateral relations.
Immediately after the Taliban's demise, Iran's foreign minister, Kamal Kharrazi, paid a two-day visit to Islamabad and reached an understanding with his Pakistani hosts on the situation in Afghanistan. Both sides agreed to assist in the establishment of a broad-based multi-ethnic government in Afghanistan under the United Nations' auspices.
Another important turning point in Iran-Pakistan relations transpired with president Mohammad Khatami's visit to Pakistan in December 2002, the first by an Iranian president in 10 years. During the visit, both sides discussed how to improve bilateral relations and regional security, focusing especially on Pakistani-Indian relations, in the light of Iran's declared willingness to mediate between them. As a result of Khatami's visit, Iran and Pakistan signed four agreements and a memorandum of understanding (MoU) aimed at enhancing their bilateral relationship, mainly in the fields of trade, plant quarantine, science and technology.
Pakistan's prime minister, Mir Zafarullah Khan Jamali, paid a return visit to Iran in October 2003, and reached a landmark preferential trade agreement. Another agreement was on the revitalization of a trilateral commission among Iran, Pakistan and Afghanistan aimed at pushing for the reconstruction of Afghanistan. Jamali visited Iran again in February 2004 to attend the Developing Eight (D-8) meeting.
In March 2004, Iran's first vice president, Reza Aref, visited Pakistan. His talks centered on further strengthening the existing cooperation between the two countries. The following agreements were signed during Aref's visit: a preferential trade agreement; an MoU between the export promotion bureaus of the two countries; an MoU to establish a joint investment company; an instrument of ratification of the agreement for avoidance of double taxation; and a customs cooperation agreement.
Economic relations
The most important issue in Iranian-Pakistani economic relations is the low level of economic exchange; both countries need to encourage and increase relations in this sphere.
Trade between Pakistan and Iran during 2005 was barely more than half a billion US dollars. Still, this must be considered an improvement over the previous years: trade between the two countries declined in 2001-02 from $394 million to $166 million. Pakistan lost Iranian markets for transport equipment and leather because of reports of delays in shipments of the poor quality of products.
A report prepared by the Federation of Pakistan Chambers of Commerce and Industry stated that the erection of unnecessary trade barriers caused a reduction in Pakistan's exports to Iran in 2002. Iran canceled an order for Pakistani wheat because of its poor quality. The main reason for the trade deficit between the two countries lay in the differential between Pakistan's exports to Iran and its importation of crude petroleum and furnace oil from Iran at a cost of $141 million (in 2002). In late 2002, Pakistan began to import Iranian electricity for Balochistan province.
On a more positive note, the recent economic reforms in Iran have improved the climate for foreign investment, including by Pakistani companies. Also, Iran has been encouraging the private sector to do business with the neighboring countries. In this regard, the Mutual Economic Cooperation Commission has prepared the ground for economic ties between Iran and Pakistan. The 13th session of this commission, held in December 2002 in Islamabad, completed its work with a note of success, pushing for the enhancement of opportunities for the private sectors of both countries to increase their exchanges.
During 2003-04, the volume of bilateral trade was about $376 million. Trade and economic cooperation was discussed in detail at the 14th session of the Joint Economic Commission held in Islamabad in March 2004. The whole range of economic activity between the two countries was reviewed and ways and means to enhance cooperation were discussed.
The second issue that affects Iranian-Pakistani economic relations is the problem of petroleum smuggling between the two countries. The problem has increased in recent years, fueled by the differential in oil prices across the common border. While several rounds of negotiations have taken place between Iranian and Pakistani officials, they have yet to yield results.
Without doubt, boosting security is important for encouraging commercial relations and preventing cross-border smuggling, notwithstanding the alarming news of kidnapping of more than a dozen Iranian guards at the Iran-Pakistan border this month.
In spite of the above-mentioned problems,
there are hopeful signs that the economic and other ties between Iran and Pakistan will improve, particularly if the much-talked-about "peace pipeline" between Iran and India transiting through Pakistan turns into reality; the estimated profit for Pakistan is one-half billion dollars annually. This aside, the two countries are now laying the emphasis on the establishment of a fiber-link network and improved communications and transport links, including the railway systems.
Impact of regional issues
While Iran and Pakistan are neighbors, their regional outlooks are somewhat different as a result of the different type and nature of national security challenges and threats facing each country.
India: Relations with India are an important issue that affects Iranian-Pakistani relations.
Pakistan is concerned about the North-South Corridor that Iran and India seek to establish together with Russia. In the light of Iran's good relations with India, Pakistan is concerned about the impact of those relations on its disputes with India - over the core issue of Kashmir as well as other regional and geopolitical issues. Iran has declared its willingness to mediate between India and Pakistan on Kashmir. In his visit to Pakistan, Khatami stated: "We will do everything possible to remove tensions between India and Pakistan." In 2004, when tensions between India and Pakistan escalated, Iran was the first country to contact Musharraf and Indian prime minister Atal Bihari Vajpayee with a view to defusing the crisis.
The proposed Iran-India gas pipeline via Pakistan remains problematic. On the one hand, this could act as an ideal platform for initiating regional economic interdependence. Iran is the fifth-richest country in mineral reserves, possessing some 10% of world's oil reserves and 14.9% of the world's natural-gas reserves, simultaneously serving as the connection link among a diverse set of regions, the Persian Gulf, the Caspian Sea, the Eastern Mediterranean, and the South Asian subcontinent.
In both India and Pakistan, energy demands exceed supplies, while Iran is in an ideal position to play the role of supplier.
While in principle there is no problem between Iran and Pakistan over the proposed gas pipeline, India's lingering security concerns, eg concern that Pakistan would use it as security leverage in the future, hamper the realization of this important project.
Afghanistan: Pakistan and Iran have shared the fallout of decades of upheaval in Afghanistan, partly in the form of millions of Afghan refugees, many of whom have not returned to Afghanistan since the Taliban's downfall in 2001. Since then, Iran and Pakistan have tried to improve relations strained for a decade by policy differences over Afghanistan, both sides coming to a recognition of the fact that sustained peace and stability are in their interests and not only those of the people of Afghanistan.
As a result, both Tehran and Islamabad gave support to the political process initiated in Afghanistan by the Bonn Agreement (among the Afghan political factions) while extending a helping hand to President Hamid Karzai's government in its efforts to rebuild Afghanistan.
A first step was the signing of the Kabul Declaration on Good Neighborly Relations by Iran and Pakistan on December 22, 2002.
A serious problem affecting Iran and Pakistan from Afghanistan is the burgeoning drug traffic, which has served as the main financial source for extremist groups, including the remnants of the Taliban.
The illicit drug-smuggling networks also serve as a conduit for the transfer of small arms and explosives and for human trafficking. Drug traffickers have been using Iran's territory as the shortest major land route for the transit of narcotics from Afghanistan and Pakistan to Europe.
Iran spends $400 million annually in its effort to control the drug traffic, and Iran and Pakistan need to bolster their security cooperation in their fight against this menace. Both countries could cooperate in attracting international aid on this project as its has much greater repercussions than purely regional ones. On the contrary, the matter affects many countries around the globe, requiring a globalized strategy led by the regional states.
Security cooperation: Over the past few years, Iran and Pakistan have taken several concrete steps to increase their security cooperation, including:
The Pakistani-Iranian Joint Ministerial Commission on security was established in November 2001 to deal with the problems of terrorism, smuggling, sectarian violence, extremism and narcotics. The initial meeting of this commission was held in September 2002.
There has been a renewal in consultations between the foreign ministers of both countries on bilateral relations and on regional and international developments. The first of such consultations was held in July 2001.
Regular interactions between Pakistani and Iranian intelligence officials have been ongoing since October 2001. These interactions are held between senior-level Inter-Services Intelligence (ISI) and Iranian intelligence officials and focus on the future of Afghanistan, Iran's role in seven cultural centers in Pakistan, cross-border broadcasts, etc.
Both countries have agreed to solve security and border issues in a special security committee.
Presence of foreign powers: Iran and Pakistan have somewhat divergent perspectives with respect to the presence of foreign powers in the region. Iran is concerned about the post-September 11 military cooperation between the US and Pakistan. However, both countries share long-term perspectives on how to deal with the intrusiveness of foreign powers in the region. Both Iran and Pakistan, for instance, opposed the United States' unilateral action in Iraq, calling for a central role for the UN.
However, although Iran and Pakistan have reached a basic geostrategic understanding regarding both Afghanistan and Iraq, their relations may be harmed as a result of the hostility between Iran and the US and Pakistan's close relations with both the US and Israel; repeatedly during 2005, Pakistani officials stated their steadfast opposition to any US military strike against Iran via Pakistani territory and/or airspace.
Nuclear cooperation: During the past couple of years, the revelations concerning the transfer of nuclear technology to Iran by the Pakistani network led by Abdul Qadeer Khan have ignited heated debates and discussions about the nature of nuclear cooperation between the two countries. Iran is concerned about the reports of Pakistan's nuclear cooperation with Saudi Arabia.
Iranian concern is fueled by, among other things, unconfirmed reports of a secret Saudi-Pakistani agreement, harking back to a high-level visit to Pakistan by a Saudi prince in 2003 after a Saudi defense official's visit to Pakistan's nuclear facilities, prompting serious speculations in Tehran that the Pakistani nuclear network headed by Khan might have traded far more sensitive nuclear technology and know-how to the Saudis than it did to Iran. After all, Khan has visited Saudi Arabia on a number of occasions, albeit for the benign purpose of attending conferences, and the Sunni connections between Pakistan and Saudi Arabia run pretty deep.
Saudi officials have denied rumors of an oil-for-nukes pact between Riyadh and Islamabad, but Iranian policymakers are put on guard by such rumors, deemed credible in the light of Pakistan's history, its close ties to Saudi Arabia, and its cash dependency on the oil-rich Saudis. Without doubt, a potential motivating factor, other than Israel, for a Saudi nuclear-weapons program is the alleged existence of such a program in Iran, which in turn may have been influenced by the threats of Saudi nuclearization.
Iran is pleased by the recent statements by Musharraf that Pakistan's nuclear assets are under strict custodial controls and that any clandestine proliferation network has been dismantled.
In conclusion, Iran's and Pakistan's concerns and interests are interlinked in the new regional and international climate.
New problems as well as new opportunities have been created for both countries, affecting their bilateral and multilateral relations, since the events of September 11, 2001. Both countries need to devote more energy to boost their economic trade, enhance their security cooperation, and to identify practical ways to tackle the problems facing the region.
Kaveh L Afrasiabi, PhD, is the author of After Khomeini: New Directions in Iran's Foreign Policy (Westview Press) and co-author of "Negotiating Iran's Nuclear Populism", The Brown Journal of World Affairs, Volume X11, Issue 2, Summer 2005, with Mustafa Kibaroglu.
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